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IIA IIA-CIA-Part3 Exam Questions
Certified Internal Auditor - Part 3, Business Analysis and Information Technology (Page 11 )

Updated On: 10-Mar-2026
Page 11 of 312
PDF with 1555 Questions

In the standard regression equation y- a + bx, how is the letter £> best described?

  1. Independent variable.
  2. Dependent variable.
  3. Y intercept.
  4. Slope of the regression line.

Answer(s): D

Explanation:

In the standard regression equation, b is the slope of the regression line.



How is the letter x in the standard regression equation best described?

  1. Independent variable.
  2. Dependent variable.
  3. Y intercept.
  4. Coefficient of determination.

Answer(s): A

Explanation:

The letter x in the standard regression equation is the independent variable. For example, in a regression to determine the total cost of production, x equals units produced.



A division uses a regression in which monthly advertising expenditures are used to predict monthly product sales (both in millions of US dollars). The results show a regression coefficient for the independent variable equal to 0.8. This coefficient value indicates that:

  1. The average monthly advertising expenditure in the sample is US $800,000.
  2. When monthly advertising is at its average level, product sales will be US $800,000.
  3. On average, every additional dollar of advertising results in US $.80 of additional sales.
  4. Advertising is not a good predictor of sales because the coefficient is so small.

Answer(s): C

Explanation:

The regression coefficient represents the change in the dependent variable corresponding to a unit change in the independent variable. Thus, it is the slope of the regression line, represented by b in the linear equation y= a + bx.



Quality control programs employ many tools for problem definition and analysis. A scatter diagram is one of these tools. The objective of a scatter diagram is to:

  1. Display a population of items for analysis.
  2. Show frequency distribution in graphic form.
  3. Divide a universe of data into homogeneous groups.
  4. Show the vital trend and separate trivial items.

Answer(s): A

Explanation:

The objective of a scatter diagram is to depict degrees of correlation. Each observation is represented by a dot on a graph corresponding to specific values of x (the independent variable) and y (the dependent variable).



A regression equation:

  1. Estimates the dependent variables.
  2. Encompasses factors outside the relevant range.
  3. Is based on objective and constraint functions.
  4. Estimates the independent variable.

Answer(s): A

Explanation:

Regression analysis is used to find an equation for the linear relationship among variables. The behavior of the dependent variable is explained in terms of one or more independent variables. Regression analysis is often used to estimate a dependent variable (such as cost) given a known independent variable (such as production).



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